PAC: Give Mueller free hand to run Malaysia Airlines

KUALA LUMPUR: New Malaysia Airlines (MAS) chief executive officer (CEO) Christoph Mueller (pic) should be given a free hand to run the national carrier as a full-fledged commercial entity, deputy chairman of the Public Accounts Committee Dr Tan Seng Giaw said.

Dr Tan, one of the longest serving MPs, said AirAsia had become the icon among world’s budget airlines because its CEO Tan Sri Tony Fernandes was able to run it with a free hand and on the basis of meritocracy.

“Fernandes has a free hand in running AirAsia, that’s why the airline is successful. He operates it on the basis of meritocracy,” he told Bernama.

“If Fernandes can, why can’t Mueller? It’s corporate management at the end of the day,” he said.

Dr Tan said Mueller had a big job to do but he was convinced the German-born CEO was up to task and would succeed, having previously turned around loss-making Aer Lingus and Sabena.

Mueller, initially hired to lead the new airline Malaysia Airlines Bhd (MAB) effective July 1, took over from Ahmad Jauhari Yahya, ahead of schedule on May 1.

This accelerated leadership transition would provide Mueller to lead the overall MAS restructuring effort while preparing MAB to begin operations this Sept1.

Dr Tan pointed out that all the conventional airline business was no longer conventional because it had changed drastically and airlines that did not change or adapt would not survive.

“Whatever needs to be done, has to be done. There is no point operating on routes and lose millions. If you are going to lose millions, you have to stop the bleeding. So how do you stop the bleeding? You see which routes are bleeding you dry and you cut those routes,” he said.

Mueller in his first message to MAS 20,000 employees had said that this year would be more challenging than anticipated with massive cost cuts.

MAS cost level is 20% higher than its peers and with sluggish demand in certain key markets despite higher discounts on ticket price, moving forward Mueller is planning for the airline to retreat and regroup before growing again.

In Dr Tans view, certain routes that are flown by MAS particularly domestic ones are not for commercial purposes but more as social flights, adding, “let’s separate the social flights from the company.”

Dr Tan said giving Mueller a free hand in running MAS must also entail zero interference from the Cabinet because “the Cabinet is not an airline company, so it must not decide how a commercial company operates and the Cabinet’s job is not to run an airline.”– Bernama